Civic CEO and cryptocurrency expert Vinny Lingham said he has reduced his exposure to Bitcoin in 2017 due to technical risks associated with the cryptocurrency.
In 2016, Bitcoin was trading at around $400, and Lingham advised people to invest in the cryptocurrency – predicting its value was set to increase significantly.
He then reversed his buy call in early 2017, following Bitcoin’s good run, due to the increased risk.
“This year, I saw the potential for a few hard forks, which created technical risks for Bitcoin,” said Lingham.
“I did not like the risks involved with Bitcoin for my investment portfolio, and I therefore reduced my exposure to Bitcoin.”
Lingham said he expects another hard fork to occur toward the end of 2017, which comes with more risk.
Despite reducing his exposure to Bitcoin, Lingham still holds the cryptocurrency – and said he is happy with its recent run. He said the value of Bitcoin may continue to rise, but he would not put a value on its ceiling.
“This good run could continue, but my concern is with the technical risks associated with Bitcoin.”
How Lingham sees Bitcoin
There is a debate on whether Bitcoin should be seen as a commodity, like gold, which is used as a value store, or whether it should be seen as a trading currency.
Lingham said Bitcoin started off as something which was a speculative commodity – essentially the world’s first digital commodity.
The cryptocurrency then became a medium of exchange which people started to use for transactions.
In the long term, the price will rise and it will become more stable. It will then become a value store for investors, said Lingham.